WORLD TRADE  
ORGANIZATION  IP/C/W/518 
6 October 2008 
 
 (08-4738) 
Council for Trade-Related Aspects 
of Intellectual Property Rights Original:   English 
 
 
 
TRANSITIONAL REVIEW MECHANISM OF CHINA 
 
Communication from Japan  
 
 
 By means of a communication from the Delegation of Japan, dated 29 September 2008, the Secretariat has received the following contribution in  the context of the transitional review mechanism 
under Section 18 of China's Protocol on Accession.  
_______________ 
 
  Japan welcomes that, in the sixth year after China's accession, the implementation of its commitments on intellectual property has evolved from th at of simple progress into one that is now in 
its cruising phase.  The transitional review mechan ism (TRM) has been useful for making China's 
transitional efforts more efficient and productive, and it is a pleasure for Japan to have contributed to 
this process. 
 In accordance with Section 18 of the Protocol on the Accession of the People's Republic of 
China (WT/L/432), which states that "China shall pr ovide relevant information … to each subsidiary 
body in advance of the review" and in the spirit  of cooperation in rendering the TRM process most 
efficient and effective, Japan requests China to provide, prior to the meeting of the Council for 
Trade-Related Aspects of Intellectual Property Ri ghts, responses and relevant information to the 
following questions and comments. 
I. COPYRIGHTS 
A. A
MENDMENT OF THE COPYRIGHT LAW 
1. Concerning the amendment to the Copyright Law, please provide us with the detailed 
schedule, including the opportunity for public comme nt from relevant stakeholders and submission of 
the comments to the State Council. 
2. Please provide us with the detailed schedule fo r the drafting of the regulation on royalty 
regulation for broadcasting and television organi zations, which Article 43 of the Chinese Copyright 
Law stipulates that the State Council is to establish.  In case the Legislative Affairs Office of the State 
Council is still in the process of establishing the regu lation, please provide us with the details of the 
progress. 
B. ROYALTY DISTRIBUTION  
3. It is our understanding that collective management  societies in China are not able to distribute 
royalties to right holders appropriately because user s of copyrighted works often do not report their 
actual usages fully.  To solve this  problem, Japan believes that ther e is a need to ensure the full IP/C/W/518 
Page 2  
 
  enforcement of a user's obligation to provide fu ll information about their usages, and a need to 
encourage them to build an adequate system for distribution, as stipulated under Article 27 of the 
Regulation for Collective Management of Copyright.  Please inform us of China's view on this matter.  
Also, if the Chinese Government is planning to take any measures against this problem, please provide us with their details. 
II. TRADEMARKS 
A. E
XAMINATION PERIOD OF TRADEMARK  
4. In 2007, China answered through the TRM that  the average pendency period for the year 
2007 was about 30 months (i.e. from the receipt of an application to the issuance of first Office 
action).  Please let us know how long it takes on aver age now.  Your informing us of the future 
perspective of a possible reduction in the av erage pendency period would be appreciated. 
5. Please also let us know the average pendency from demand to first action and from demand to 
final decision for the opposition process to be  administered by the Chinese Trademark Office 
(CTMO) and for the appeal examination process by the TRAB. 
B. EXAMINATION GUIDELINES OF TRADEMARK  
6. According to Article 10(2) of the Chinese Trad emark Law, "the foreign geographical names 
well known to the public shall not to be used as tr ademarks."  Please let us  know how the CTMO has 
been examining an application involving a fore ign geographical name well known to the public.  
Please also let us know the examination practices and interpretative criteria for "the foreign 
geographical names well known to the public."  
7. In China, some trademark applications have been  filed by third parties for the registrations of 
geographical names of Japan or common names of products or names of plant varieties of Japan.  Such filings have increased th e business risk of Japanese compan ies with business operations in 
China.  Japan wishes to know how an application involving a foreign geographical name, a foreign common name of a product, or a foreign name of a plant variety is treated under the Chinese 
Trademark Law.  We would appreciate your answering the following questions. 
8. If it is discovered that an application filed with  the CTMO for a mark comprising or involving 
characters that are likely to cause confusion with a foreign geographical name and if the name is well 
known to the public, will the application be re fused (or will the trademark be cancelled after 
registration, if the discovery is made after tradem ark registration) under Article 10(2) of the Chinese 
Trademark Law? 
9. Article 11(2) of the Chinese Trademark Law sets fort h that signs "that have direct reference to 
the quality, main raw material…or other characteristi cs of goods or services" "shall not be registered 
as a trademark."  Is it necessary for a foreign common  name of a product or a foreign name of a plant 
variety to be known among the consumers of the goods in question in China for the application to be refused or the registration to be cancelled under Article 11(2)? 
C. G
UIDELINES FOR THE FAIR USE THEREOF BY ANOTHER PERSON  
10. Article 49 of the Regulations for the Implementation of the Trademark Law of the People's 
Republic of China sets forth that signs "where a registered trademark consists of the generic 
name…or directly shows the quality, main raw mate rials…or other characteristics of the goods in 
question, or consists of geographical  names, the proprietor of the exclusive right to use the registered 
trademark shall have no right to prohibit the fair  use thereof by another person."  What is the  IP/C/W/518 
 Page 3 
 
 
  benchmark for "fair use" under this provision?  Is it possible to recognize a foreign geographical 
name, a foreign common name of the product or a fore ign name of the plant variety as "fair use," if 
the name is known among the consumers of  the goods in question in China? 
III. ENFORCEMENT 
11. We would like to know what concrete effo rts and future plans you have to strengthen 
intellectual property right protection in provincial areas and enlighten provincial authorities and other 
issues related to provincial efforts. 
12. We would like to know which civil case or  criminal penalties will be imposed on 
manufacturers, distributors or vendors preparing for distribution where a brand is not indicated on a 
product at the stage of manufacturing and then a fals e brand is affixed to the product at the stage of 
distribution or at the preparatory stage of distribu tion, and the procedure is not regarded as illegal until 
this stage. 
IV. OTHERS 
A. ANTIMONOPOLY LAW 
13. We understand the guidelines for the antimonopoly law, which came into force in August 
2008, are under the process of the formulation.  Pleas e provide the information related to the situation 
of the formulation and the outline of the guidelines re lated to the enforcement of intellectual property 
rights. 
14. Particularly, Article 55 of the Antimonopoly Law says that "the Law is applicable to 
undertakings' conduct that eliminates or restricts competition by abusing their intellectual property 
rights". Please let us know whether there are any criteria for determining a conduct abusing the 
intellectual property rights, and if any,  please provide us with their details. 
B. THE CONFLICT BETWEEN TRADE NAMES AND TRADEMARKS  
15. We understand that China is planning to re vise the existing Law to Counter Unfair 
Competition and that the said revised law will deal  with cases where trade names which incorporate 
other's trademarks or trade names th at are, without the true owner's authorization, registered in China 
or other countries/regions and used in China.  We ha ve been informed that a small part of this has 
been implemented by said revision through a Judi cial Interpretation (the "Relevant Parts of 
Interpretation of the Supreme People's Court Concerning Some Issues on the Specific Application of Law for Handling Civil Cases of Unfair Competition" ) issued in January 2007 and a special campaign 
against free ride action on the fa mous brand from August to December 2007.  We would like to know 
how China is going to deal with this issue. 
C. L
ICENSING REGULATIONS  
16. Article 25 of the Regulation on the Administration of Import and Export Technology states 
"the licensor must ensure that the technology prov ided is complete, correct and effective and may 
fulfil the agreed technological goal."  At the TRIPS Council in 2007, the explanation regarding the 
article was, "Ensuring the fulfilment of the above requirement as is prescribed by the aforementioned 
provision is mandatory but Chinese authorities will not  reject contracts on the ground that there is no 
description in the contracts which ensure that the technology provided is complete, correct and 
effective and may fulfil the agreed technological goal." IP/C/W/518 
Page 4  
 
  17. However, the explanation above does not ma ke clear enough what specific requirements 
should be sufficiently fulfilled in order to "ensur e that the technology provided is complete, correct 
and effective and may fulfil the agreed technological  goal."  Accordingly, we would like to ask you to 
do the following: 
(a) Please provide the specific requirements that  should be fulfilled in order to show the 
aforementioned provision has sufficiently been met. 
(b) Please establish new interpretive guidelines specifying the above specific 
requirements because a vague requirement mi ght be too much bur den for contracting 
parties. 
D. G
OVERNMENT POLICY  
18. Please provide the information described below related to "China's Action Plan on IPR 
Protection 2008". 
(a) The schedule for the revisions and the main point of the revisions of the "Trademark 
Law", the "Law Against Unfair Competition", the "Rules for Implementation of the Patent Law" and the "Rules for Implemen tation of the Regulations on Customs IPR 
Protection". (I. Legislation (I) 1 and 2, (III)2, (IV)3); 
(b) The outlines of the "cross-regional IPR protection mechanism" (IV. Institution 
Building (I)2) and the "regional coordinati ng mechanism for patent administrative 
enforcement" (IV. Institution Building (I)9); 
(c) The main issues and the study themes of the "research on "rules of evidence in IPR 
civil litigation" (X. Plan for Special Resea rch (I)6) and the "theoretical research on 
IPR criminal protection" (X. Pl an for Special Research (I)9); 
(d) The main issues and the study themes of  the "general situation of IPR cases of 
criminal private prosecution". (X. Plan for Special Research (I)8) and the statistical 
data of the IPR cases of criminal private prosecution. 
19. We understand that China revealed new national strategy on intellectual property in June 
2008 and newly created a protection and coordination division implementing the strategy in the State 
Intellectual Property Office.  We would like to know  the role of the division and how China is going 
to implement the strategy. 
 
__________